Warren Buffett's Snide Attack on Fox News

by Judy Kent

 

Omaha, NE / Washington, D.C. -  Today, at the Berkshire Hathaway shareholder meeting in Omaha, Nebraska, Warren Buffett stood by his support for a soak-the-rich tax policy in response to shareholder questions, made a snide reference to the Fox News Channel and made a sharp distinction between his own version of the so-called 'Buffett Rule' and President Obama's.

"Multiple shareholders expressed concern that Buffett's personal politics, in steadfastly promoting the Buffett Rule, is harming Berkshire Hathaway's image and share value," said Justin Danhof, general counsel of the National Center for Public Policy Research, who attended the meeting for the National Center. "Buffett dismissed these concerns, expressing his right as a citizen to promote his own personal political beliefs and snidely suggesting that one shareholder, who was concerned about Buffett's policy preferences, go invest in Fox instead."

Buffett did not, however, endorse the White House tax plan.

"Under criticism for his political advocacy, Buffett distanced himself from the White House version of the Buffett Rule, saying his plan was only about the 400 richest Americans," said Danhof. "The Obama Administration is pushing the Buffett Rule on businesses and families making over a million dollars a year. So that's a whole lot different from what Warren Buffett is promoting."

"Buffett also lambasted the Citizens United Supreme Court decision; said he wished it had never happened, pledging to never donate to any Super PAC," added Danhof. "And one woman asked him how he would suggest fixing Fannie and Freddie. He said that was a very complicated question and he didn't have a real answer for her. But a good ninety percent of the questions weren't about public policy at all; they were from people trying to glean a bit of investment wisdom or advice on world markets in general. It was really all about money."

Describing the meeting's general atmosphere, Danhof said, "The doors opened at seven; I got here at six, and there were already thousands of people in line. It was more like a Grateful Dead concert; almost cult-like. Some folks were paying college students to line up for them at midnight."

Danhof says that at the start of the meeting, the company presented a comedy video making light of the fact that Warren Buffett's secretary may now be more famous than he is. "It was actually pretty funny," said Danhof.

Danhof attended the meeting hoping to ask Buffett about both the Buffett Rule and the National Center for Public Policy Research's belief that Berkshire Hathaway might gain financially from President Obama's decision to halt the Keystone XL Pipeline. A subsidiary of Berkshire Hathaway, Burlington Santa Fe, owns rail lines that could bring oil in the form of tar sands from Canada to the U.S. in lieu of the pipeline. Danhof planned to ask Buffett: "Did you advise the President on this matter or have any prior knowledge of his decision? Do you find it at all disturbing that the leader of the free world chose to financially benefit his friend - you Mr. Buffett, a "1 percenter" - at the expense of the American people and tens of thousands of new jobs? What is so fair about that?"

Questioners at the shareholder meeting are chosen by lottery, and Danhof was not chosen. Danhof's complete prepared question is available here. At the suggestion of a Berkshire Hathaway employee, Danhof is emailing the question to the company, and he will make available any reply.

In April 2011, Buffett penned his now infamous New York Times op-ed that called on Congress to "stop coddling the rich" and increase their taxes. Since then, President Barack Obama has proposed a plan, dubbed the Buffett Rule, which would impose a 30 percent tax levy on all households, individuals and small businesses that earn $1 million per year.

"The White House 'Buffett Rule' does nothing to alleviate the massive deficits run up under Obama's watch. It is just a divisive distraction from real issues like unemployment and the economy," said Danhof. "Instead of real policy solutions, Buffett and Obama are promoting social justice and fairness that does nothing but create envy and promotes class warfare."

According to the Joint Committee on Taxation, the White House version of the 'Buffett Rule' would bring in less than $5 billion per year - an amount that would only pay for about a week and a half's worth of interest on the national debt.

"As one of the country's best investors, it seems odd that Buffett would support a jobs-killing tax system. Claiming that top earners aren't paying their fair share is mere populist rhetoric that avoids the reality that in America the wealthiest create most of the jobs and pay an inordinate amount in federal taxes," said Danhof. In 2008, according to Rob Bluey of the Heritage Foundation, the top one percent of earners paid 38 percent of all federal taxes and the top 10 percent paid 70 percent of federal taxes, while 49 percent of U.S. households paid no federal income tax.

The Buffett Rule philosophy ignores that many of the so-called rich earn money through investment income that is commonly taxed at 15 percent, but this income has already been subject to multiple layers of tax - including the highest corporate tax of any industrialized nation. By the time all the taxes are paid, investment income may be subject to taxes of 40 percent or more, Danhof said.

Danhof attended the meeting as proxy for the National Center's executive director, David Almasi, who is a Berkshire Hathaway shareholder. The National Center for Public Policy Research also is a Berkshire Hathaway shareholder.